Verizon (VZ): Assessing Valuation After Strategic Moves Into Healthcare and Affordable Internet Services

Verizon Communications (VZ) is making waves this month by signing new deals to deploy Neutral Host and Private 5G networks at major healthcare facilities, while also rolling out affordable Home Internet Lite plans to more communities.

See our latest analysis for Verizon Communications.

Although Verizon’s momentum has eased lately, with a 10.1% decline in the 30-day share price return and the stock closing at $38.82, buzz around its Neutral Host and Private 5G wins shows the company is hardly standing still. Over the long run, total shareholder returns of 26% over the past three years highlight Verizon’s ability to deliver steady value, even through competitive and strategic shifts in the telecom world.

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With Verizon shares currently trading at a notable discount to analyst targets and recent growth initiatives gaining steam, investors may be considering whether the stock is being overlooked by the market or if future upside is already reflected in its current price.

Most Popular Narrative: 20.1% Undervalued

With Verizon closing at $38.82, the current narrative pegs fair value at $48.61, which suggests a material gap between consensus expectations and where shares currently trade. This valuation draws on detailed assumptions surrounding broadband and 5G expansion, margin gains, and the company’s forward momentum.

The rapid expansion of fixed wireless access (FWA) and fiber broadband, as evidenced by accelerating subscriber growth (5M+ FWA subscribers, robust broadband net adds, and the pending Frontier acquisition), positions Verizon to capitalize on surging demand for high-quality home and business connectivity as more devices, smart homes, and bandwidth-intensive applications proliferate. This, in turn, supports future service revenue and ARPU growth.

Read the complete narrative.

Curious what assumptions lead analysts to set Verizon's fair value so far above its market price? The key drivers behind this bullish call, such as future margins and ambitious earnings targets, might surprise you. See exactly how market expectations are shaped by strategic expansion and growth blueprints in the full narrative.

Result: Fair Value of $48.61 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, persistent subscriber churn and the heavy costs of 5G and fiber expansion could present challenges for Verizon’s ability to sustain future earnings momentum.

Find out about the key risks to this Verizon Communications narrative.

Build Your Own Verizon Communications Narrative

If you want to dive deeper or take a different perspective, you’re free to crunch the numbers yourself and shape your own view in hardly any time. Do it your way

A great starting point for your Verizon Communications research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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